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Indictments stemming from Hollywood’s latest celebrity scandal have struck fear into L.A.’s legal community. But it’s the civil fallout from private eye Anthony Pellicano’s wiretapping indictment that instills true horror for law firms. While top entertainment lawyer Terry Christensen is the only attorney indicted so far in connection with Pellicano, several others face litigation that could cripple their practices � and possibly break up their firms. The big problem, said Timothy Halloran, an expert in law firm liability at Murphy, Pearson, Bradley & Feeney in San Francisco, is that illegal activity such as wiretapping won’t be covered by malpractice insurance. “I would expect that in the Pellicano matter, if the wiretapping was in connection with big litigation, someone who was wiretapped can make a pretty big damages claim,” Halloran said. “Your professional liability insurance can’t cover you for that.” That’s the issue that much of the L.A. legal community is looking at these days, as a small but well-armed armada of plaintiffs takes aim at lawyers who used Pellicano for wiretaps. Developments over the past week indicate that while Christensen may be the first lawyer indicted, another top firm � L.A. entertainment shop Greenberg Glusker Fields Claman Machtinger & Kinsella � may be feeling even more heat. At least a half-dozen Greenberg Glusker attorneys are talking about leaving, according to a source within the firm. And while some Greenberg Glusker attorneys said last week that they were confident that the firm’s future was stable, others were unsure how the firm would weather Pellicano-related lawsuits. A look at the first suit filed against the firm in connection with Pellicano shows why they may be nervous. An amended complaint filed Thursday by Gregory Dovel, an attorney for screenwriter Vincent “Bo” Zenga, is based largely on federal prosecutors’ allegations that Zenga was wiretapped by Pellicano in 2000. The complaint says Pellicano tapped nearly 1,600 phone calls, allegedly at the behest of top Greenberg Glusker partners. Under state law, each illegal wiretapping count carries minimum statutory damages of $5,000 � meaning defendants could be on the hook for about $8 million on the wiretapping claims alone, never mind punitive damages or other claims. Dovel said Greenberg Glusker’s insurance probably wouldn’t pick up any tab unless a jury found negligence rather than intentional wrongdoing. “You run into a problem there because you don’t want to walk people out of coverage,” said Guy Calladine, a law firm liability expert at Carlson, Calladine & Peterson in San Francisco. “You want to try to pigeonhole these as negligence.” That seems unlikely in cases like Dovel’s and an ongoing suit against several smaller law firms accused of using Pellicano to wiretap litigants, since they allege intentional malfeasance. So Dovel said he’ll probably have to take aim at firm equity or the assets of individual partners who took part in wiretaps. “That’s one of the difficulties of law firms,” he said. “They’re very thinly capitalized. They take all the money out at the end of the year.” Greenberg Glusker isn’t the only firm with such concerns. Plaintiff lawyers � including several firms known for a string of large verdicts � have been retained by clients who were allegedly wiretapped by other firms, including Christensen’s firm, Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro. But the Christensen firm reportedly had relatively limited dealings with Pellicano, and shows fewer signs of concern than Greenberg Glusker, which had a long-standing relationship with Pellicano. At least three current or former Greenberg lawyers have hired attorneys in connection with the criminal probe. Star partner Bertram Fields is known to have used Pellicano extensively, and partner Bonnie Eskenazi has been mentioned by several sources as someone who worked frequently with the private eye. Eskenazi � who said last week that she’s not a target in the criminal investigation, and that she doesn’t have a lawyer � would not elaborate on her relationship with Pellicano, saying “many people worked with him.” Another lawyer at the firm � Ricardo Cestero, who has represented actor Tom Cruise � worked for Pellicano prior to joining Greenberg. “I’m not going to comment,” he said last week. Brian Sun, the Jones Day partner representing Greenberg Glusker, would not comment on civil litigation. Brian Panish, who represents a client who claims she was wiretapped, said Friday he’s talking to potential clients, and may have several suits in the works. Kabateck Brown Kellner partner Brian Kabateck, who also represents wiretap plaintiffs, said it’s likely law firms such as Christensen, Miller will be implicated in future suits. “I’ve spoken to people whom it’s safe to say are clearly victims of law-firm-directed wiretapping,” he said. Lawyers at Gaims, Weil, West & Epstein, a firm with a much lower profile than Greenberg Glusker, are also facing civil liability in a suit filed by Kissandra Cohen, a lawyer who worked with the now-deceased L.A. toxic tort attorney Edward Masry. In an ongoing federal suit, Cohen says she was wiretapped by Pellicano at the behest of attorneys with the L.A.-based Gaims firm. That firm had an ongoing relationship with Pellicano: partner Alan Weil, who didn’t return repeated phone calls, represented Pellicano in the 2002 criminal case that sent him to jail for possession of illegal explosives. And Victor Sherman, who worked on Pellicano’s defense with Weil, confirmed that Pellicano had worked for Weil prior to that case. Ami Shafrir, who was engaged in litigation with a Gaims, Weil client, said last week that a lawyer at that firm hired Pellicano to wiretap him. That wiretap is cited in the Pellicano indictment. Gaims, Weil partner Marc Epstein, Shafrir said, asked questions in a deposition about information that could only have come from private conversation that were likely wiretapped. Epstein did not return phone calls for this story, and a partner at the firm would not say whether they have a lawyer in the criminal case. The firm’s lawyer in Cohen’s suit, Dorothy Wolpert � a partner at Bird, Marella, Boxer, Wolpert, Nessim, Drooks & Lincenberg in L.A. � would not comment on the suit last week, but said it’s set for trial in July in L.A. federal court. That case will likely be the first indication into how firms will handle the wiretap charges. But Halloran, the law firm liability lawyer, has an idea of what will happen to firms in the event of a big verdict. “Bankruptcy may be the only alternative,” he said.

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